TRADING STRATEGY FOR 15TH OCTOBER 2009
(Based on technical by O P AGARWAL)



Markets extend rally on strong Q2 nos.

The market opened gap up yesterday on strong global cues and better than expected Q2 results by the HDFC, HDFC Bank, Axis Bank etc. Market participants were seen with buoyant mood on reports that selected frontline companies have recently won big orders which indicates reversal in economic slowdown. The Sensex, which after hitting a 17 month high at 17274 finally closed the session with massive gain of more than 200 points at 17231. The Nifty closed at 5118, up 63 points or 1.27% over its previous close. Stocks from almost all the sectors remained firm yesterday except telecom and cement. The market breadth remained positive yesterday since on BSE, 1685 stocks closed with gains. 1075 stocks declined and 80 stocks ended flat. Meantime, FIIs remained net buyers worth a net Rs 1468.82 crore yesterday as per provisional data, which also helped the market sentiment. However, readers are advised to trade with caution and remain stock specific.


NIFTY FUTURE (Last close 5114.85)
The counter after gap up opening yesterday rallied higher on strong global cues and fresh buying in front line stocks coupled with short covering. The NF appears positive on charts and may extend gains but one needs to remain alert while trading since the NF has surged sharply in a short span.

JAI PRAKASH HYDRO FUTURE (Last close 80.80)
The company is a part of the Jaypee Group which owns and operates the 300-megawatts (MW) Baspa-II Hydroelectric Project in Himachal Pradesh. The company has recently received permission for amalgamating its subsidiaries for better synergy. The company will announce its Q2 results today which may impact the stock price either way. Meantime, the stock after moving range bound during the past fortnight closed yesterday above its weekly resistance with high volumes. The stock appears positive on weekly charts and may move up to 84/86 once it trades and remains above 81.05. Strong support for the stock exists at 78.00.

TATA TEA FUTURE (Last close 879.75)
The company owns brands like Tetley and Glaceau among others. The company carries major plantation activity in India and Sri Lanka. The company is in the process of consolidating its international reach and shed the image of a tea company by diversifying into specialty and green teas, coffee, mineral water and ready-to-drink beverages, a move which is expected to yield financial benefits in 2-3 years. The company’s net profit rose 13.9% to Rs 42.96 crore in Q1 June 2009 over Q1 June 2008 despite economic slowdown. Meantime, the stock after moving range bound during the past three trading sessions closed yesterday near its weekly resistance with moderate volumes. The stock appears positive on weekly charts and may move up to 889/896 once it trades above 883.25. Strong support for the stock exists at 876.25.

DEAR READERS,
PLEASE WATCH THE MARKET TREND AND USE YOUR
OWN DISCRETION BEFORE TAKING A TRADE.
Protect profits with trailing stops and cut losses fast.
Avoid adding contracts in loss making trades